Investments in hotel and commercial real estate 2021

The Balearic Islands have been a popular investment market for buyers and investors for many decades. A villa, flat, finca or penthouse has always been considered a sound investment, not only from a financial point of view, but also in terms of enjoying a completely different lifestyle. Due to the corona situation and the double lockdown, commercial property rentals as well as hotel occupancies are in crisis. Current estimates show that 30-40% of commercial properties in Mallorca are vacant. Many businesses have temporarily closed and some will not recover from the Corona crisis.

This in turn has affected the dynamics and pricing of commercial property. Many see investment potential in this and private equity groups and high net worth individuals will continue to be active investors in hotel and commercial real estate in 2021. It will be interesting to see what happens after Corona, and as Mallorca has seen a significant price increase of around 31% in the last five years, there could be more investment opportunities as before. International investors are currently keeping a close eye on commercial property in the Balearics, including Mallorca. Hotels in sought-after locations and commercial property in prime locations in Palma are particularly high on the list.